Simple Interest
Math MCQs

Question :    Calculate the amount due after 10 years if James borrowed a sum of $5000 at a rate of 3% simple interest.

Correct Answer  $6500

Solution & Explanation

Solution

Given,

Principal (P) = $5000

Rate of Simple Interest (SI) = 3%

Time (t) = 10 years

Thus, Amount (A) = ?

The Rate of Interest is always calculated per annum, i.e. per year.

Thus, here 3% simple interest means, Rate of Simple Interest (SI) is 3% per annum.

Method (1) Using Formula

Calculation of Simple Interest

Formula to Calculate Simple Interest

Simple Interest (SI) = Principal × Rate × Time

Thus, Simple Interest (SI) = $5000 × 3% × 10

= $5000 ׳/₁₀₀ × 10

= ^{5000 × 3 × 10}/₁₀₀

= ^{15000 × 10}/₁₀₀

= ¹⁵⁰⁰⁰⁰/₁₀₀

= $1500

Thus, Simple Interest = $1500

Calculation of Amount

The total money paid to the lender by a borrower is called the Amount.

In other words, sum of priciple and interest is called the Amount.

Formula to Calculate the Amount

Amount = Principal + Interest

Thus, Amount = $5000 + $1500

= $6500

Thus, Amount to be paid = $6500 Answer

Method (2)

Calculation of Amount when Principal, Rate of Simple Interest and Time are given

Calculation of Amount directly using Principal, SI, and Time

Formula to calculate the Amount

Amount (A) = Principal (P) + Principal(P) × Rate of Interest (SI) × Time (t)

⇒ A = P + PRT

Here in the question, P = $5000

Rate of Simple Interest (SI) or (R) = 3%

And, Time (t) = 10 years

Thus, Amount (A)

= $5000 + ($5000 × 3% × 10)

= $5000 + ($5000 ׳/₁₀₀ × 10)

= $5000 + (^{5000 × 3 × 10}/₁₀₀)

= $5000 + (^{15000 × 10}/₁₀₀)

= $5000 + (¹⁵⁰⁰⁰⁰/₁₀₀)

= $5000 + $1500 = $6500

Thus, Amount (A) to be paid = $6500 Answer

Method (3) Unitary Method

Calculation of Amount using Unitary Method

Calculation of Interest using Unitary Method

Here, given Rate of Simple Interest = 3%

This, means, $3 per $100 per year

∵ For $100, the simple interest for 1 year = $3

∴ For $1, the simple interest for 1 year = ³/₁₀₀

∴ For $5000, the simple interest in 1 year

= ³/₁₀₀ × 5000

= ^{3 × 5000}/₁₀₀

= ¹⁵⁰⁰⁰/₁₀₀ = $150

Thus, simple interest for 1 year = $150

Therefore, simple interest for 10 years

= Simple interest for 1 year × 10

= $150 × 10 = $1500

Thus, Simple Interest (SI) = $1500

Calculation of Amount

Amount = Principal + Interest

Thus, Amount = $5000 + $1500

= $6500

Thus, Amount to be paid = $6500 Answer

Similar Questions

(1) Calculate the amount due if Thomas borrowed a sum of $3800 at 6% simple interest for 4 years.

(2) Find the amount to be paid if Michael borrowed a sum of $5300 at 8% simple interest for 8 years.

(3) Joseph took a loan of $5400 at the rate of 9% simple interest per annum. If he paid an amount of $9774 to clear the loan, then find the time period of the loan.

(4) Calculate the amount due after 9 years if John borrowed a sum of $5200 at a rate of 4% simple interest.

(5) If Jennifer paid $3770 to settle his loan which he had taken 4 years before at a simple interest of 4%, then find the loan taken.

(6) Calculate the amount due after 9 years if Jessica borrowed a sum of $5750 at a rate of 8% simple interest.

(7) Find the amount to be paid if Elizabeth borrowed a sum of $5450 at 8% simple interest for 7 years.

(8) Sarah took a loan of $5700 at the rate of 9% simple interest per annum. If he paid an amount of $8778 to clear the loan, then find the time period of the loan.

(9) What amount will be due after 2 years if Donald borrowed a sum of $3750 at a 10% simple interest?

(10) Find the amount to be paid if David borrowed a sum of $5400 at 4% simple interest for 7 years.